Volvo International Case Study

I. INTRODUCTION

The modern business world is one of global proportions. Estimated world population in 2004 totaled over 6.3 billion people in over 192 independent countries and 55 dependent states (U.S. Department of State, 2005). Globalization has changed the world of business forever. In 2004, world GDP equaled $51.48 trillion with world trade amounting to over $12.9 trillion ("The World Factbook," 2004). Since the end of World War II, the international business world has gradually developed into one large multicultural and global economy. In order to survive and be successful in the highly competitive world of international business, a company must understand the true impacts of globalization upon the field of business and be prepared to implement flexibility and cultural sensitivity into all areas of business operations.

According to Hodgetts and Luthans, a multinational corporation (MNC) is "a firm that has operations in more than one country, international sales, and a nationality mix of managers and owners (2003)." When dealing with multinational corporations and the field of international business management there are four primary areas that must be taken into consideration; they are the following: country environment, culture, organizational strategy, and organizational behavior (Hodgetts, 2003). All companies seeking to establish operations on a global or multinational level must be aware of these four areas and be prepared to make allowances and adapt to the incessant and constantly changing demands of the international business world (Hodgetts, 2003).

Purpose of Study:

The purpose of this study is to examine the international operations of the multinational corporation Volvo. This study will focus primarily upon the following categories of Volvo's international operations: trucks, busses and coaches, and construction equipment. It is the objective of this study to examine the international operations of Volvo in the above-mentioned areas within the countries of Sweden, South Korea, and China. Based upon its findings this report will examine two major issues concerning Volvo's operations in these countries. The overall purposes of this study are four-fold in nature as follows:

1. To provide an organizational overview of Volvo including such areas as the following: historical background, corporate values, company mission statement, organizational hierarchy, organizational structure, global involvement, and products and services offered.

2. To conduct an external analysis, internal analysis, and SWOT analysis of Volvo operations in the three countries of Sweden, South Korea, and China. The objectives of this portion of the research are to examine the external environments of each of these countries, report upon Volvo's operations within these countries, and examine in depth the role that Volvo plays in these different nations.